MOSCOW: Russia's Polymetal returned to profit in 2015 helped by a weaker rouble and the absence of certain write-offs that had pushed the gold and silver producer to a net loss in 2014.
The company, part-owned by businessman Alexander Nesis, also recommended a final dividend payment of $0.13 per share, bringing the dividend for 2015 to $216 million, up 25 percent.
Net profit in 2015 was $221 million following a net loss of $210 million in 2014. The weaker rouble reduced its total cash costs by 15 percent.
"The results exceeded our expectations, as free cash flow generation was slightly above our estimates due to good cost control," said Boris Sinitsyn, an analyst at VTB Capital.
He added: "The key concern was final dividend recommendation as leverage has temporary climbed to just below 2.0x, upper bound of comfortable range."
Polymetal's net debt to EBITDA ratio, a measurement of leverage, which shows how many years it may take for a company to pay back its debt, rose 8 percent to 1.97.
Its shares fell 6 percent in London, underperforming a 0.25 percent rise in the FTSE Gold Mines Index. Still, shares are up 26 percent since January, and this month traded around their highest levels since September 2013 as gold prices rose.
Adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) fell 4 percent to $658 million.
Polymetal Chief Executive Vitaly Nesis told Reuters the net debt to EBITDA ratio was a comfortable level for the company and it could pay out a special dividend for 2016 or make additional investments if the ratio improves or remains flat.
Polymetal also forecast total cash costs for 2016 of between $525-$575 per gold equivalent ounce, which is a mix of gold and other metals, and capital expenditure at $340 million, up 66 percent from a year ago.
Production is expected to be 1.23 million ounces of gold equivalent.
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